Methods of Supplier Selection in the Industrial Market

Abstract

The article is devoted to the study of modern methods for supplier selection in the industrial market, which constitute a key tool for ensuring an effective procurement policy in the context of globalization, intense competition, and economic instability. The paper systematizes the main stages of the supplier selection process, including: identification of procurement needs, development of requirements and specifications, analysis of "make or buy" alternatives, search for potential suppliers, their preliminary evaluation, ranking, contract negotiation, monitoring of contract execution, and assessment of cooperation effectiveness. Particular attention is paid to the supplier selection stage based on a comprehensive consideration of a number of critical factors: economic (price, total cost of ownership), quality-related (compliance with standards, certification), logistical (delivery terms and reliability), service-related (warranty service, customer support), technological (innovativeness, production flexibility), reputational, and strategic (reliability, alignment with the company’s long-term goals). A comparative analysis of analytical and computational methods (classical ranking, classification-based ranking, pairwise comparisons, T. Saaty’s Analytic Hierarchy Process, and linear integer programming) and synthetic approaches (notably benchmarking) has been conducted. Their advantages, disadvantages, and areas of appropriate application are identified. An improved classification-based ranking method is proposed, which partially addresses the issue of non-compensatory criteria and ensures greater objectivity in evaluation. Future research is expected to focus on the development of an integrated factor-based model aimed at enhancing the accuracy, adaptability, and practical relevance of supplier selection processes across various industrial sectors.